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Charles F. Dolan Requests New York State Public Service Commission Review Altice's Management of News 12
[March 20, 2019]

Charles F. Dolan Requests New York State Public Service Commission Review Altice's Management of News 12


NEW YORK, March 20, 2019 /PRNewswire/ -- In a letter dated March 19, 2019, Charles F. Dolan requested the New York State Public Service Commission ("PSC" or "Commission") immediately begin a comprehensive review of Altice N.V.'s compliance with the Commission's conditions regarding the approval of its 2016 acquisition of Cablevision Systems Corporation, including its News 12 subsidiary.

This request comes after a court order dated February 13, 2019, in which the Honorable Joseph R. Slights III, Judge, Court of Chancery, State of Delaware, ordered Altice USA to maintain "Status Quo" staffing levels at News 12 for the remainder of the lawsuit and scheduled trial for September 4 – 6.   

The ruling prohibits Altice from reducing positions for News 12 staff until the matter is resolved by the Court. The order states, "During the pendency of this Action in this Court, Altice shall not terminate any News 12 employee other than (i) for actual, bona fide cause or (ii) after first obtaining prior permission from the Court."

Additionally, in a letter dated January 15, 2019, Charles F. Dolan requested more than 300 municipalities in New York, Connecticut, and New Jersey review their cable franchise agreements with Altice N.V.

Charles F. Dolan Background

Charles F. Dolan launched Cablevision in 1973 and led it until its sale to Altice for $17.7 billion in 2016. He owns controlling stakes in AMC Networks and Madison Square Garden and is active on many boards and not-for-profit healthcare and educational organizations. He signed the letter requesting the PSC conduct a review because he cares about News 12 being operated as agreed to in 2016.

Excerpts from Charles F. Dolan's Letter Request to the PSC

"Recent actions by Altice, and its overall pattern of conduct since closing that 2016 transaction, raise concerns that Altice has flouted the commitments it made to the Commission and New York residents." 

"In particular, Altice's post-merger termination of approximately 70 employees at Cablevision's News 12 subsidiary and its reorganization of News 12 operations stand in contrast to significant job protection commitments Altice agreed to in order to secure Commission approval of the transaction. These broken promises by Altice lowered News 12's employee levels and, in turn, materially reduced service quality of News 12's hyper-local news coverage in New York State." 

"These actions warrant a Commission review to ensure that Altice has complied with its obligations to the Commission and, if not, to determine if enforcement proceedings should commence." 

Documents

A website - www.dolanalticelawsuit.com - a link to the letter from Charles Dolan to the Public Service Commission, prior legal filings and court orders, news releases as well as major media coverage on the lawsuit, a Facebook message from Patrick Dolan to News 12 employees, and a letter of support from Long Island's Fair Media Council.

Comments by Patrick Dolan

Patrick Dolan, who was president of News 12 at the time of its sale to Altice USA, commented, "This request of a review by the PSC coupled with the lawsuit we have initiated, are intended to protect News 12's staff jobs and the quality of local programming they deliver."

"Additionally, we have requested that over 300 municipalities in New York, Connecticut, and New Jersey review their cable franchise agreements with Altice N.V."



Background on Lawsuit Filed September 4

Altice is no stranger to lawsuits. Records show Altice as a party to 235 lawsuits worldwide for the three years 2016 to 2018.  


A lawsuit and request to permanently enjoin Altice USA was filed September 4 in the Court of Chancery, State of Delaware by the Dolan Family against Altice USA (NYSE: ATUS) for failure to abide by promises Altice made in a 2016 Merger Agreement and for equitable fraud, among other claims.

The lawsuit targets Altice USA and alleges that the company ignored commitments made as part of its merger with Cablevision Systems Corporation (Cablevision). The merger of Altice and Cablevision closed in June 2016 for a value of $17.7 billion.

Plaintiffs in the lawsuit originally included: Charles Dolan, founder and former CEO, Cablevision; Helen Dolan; James Dolan, former CEO of Cablevision; Patrick Dolan, president of News 12 at the time of the sale; and Colleen McVey, current employee of and news anchor with News 12 Networks. The lawsuit was subsequently amended to include a second long-serving anchor Danielle Campbell.

This lawsuit was filed to protect employee jobs and programming quality at News 12, which operates a group of local news television channels throughout New York, Connecticut, and New Jersey.

2016 Agreement Conditions

In order to induce the sale in 2016, Altice USA unambiguously agreed to operate News 12 substantially in accordance with the News 12 Business Plan through at least the end of 2020.

The Business Plan provided News 12 would employ full-time equivalent headcount of 462 people throughout this period.

Altice expressly recognized, accepted and agreed, in adhering to the News 12 Business Plan, to incur cumulative losses of up to $60 million, which has not occurred, in the operation of News 12 over the period to maintain the network's existing employee base, as well as the quality and legacy of News 12.

2016 Merger Agreement

A key provision of the 2016 Merger Agreement was the requirement for Altice to operate News 12 in accordance with News 12's Business Plan through at least the end of 2020 and support News 12 employees who were responsible for making the network unique among local television stations.

Altice agreed to these nonstandard provisions in a transaction of this type, because Altice knew that continuing the legacy of News 12 was an important consideration for the Dolan Family and a necessary inducement to agree to the merger.

These covenants were of such importance to the merger, Cablevision intentionally disclosed these protections to public shareholders.

Altice Breached Merger Agreement

Turning its back on its prior representations and promises, in 2017 Altice eliminated approximately 70 News 12 positions — in direct violation of News 12's agreed-upon business plan incorporated into the Merger Agreement.

Again in 2018 Altice informed the Dolans that Altice was on the verge of terminating dozens more News 12 employees, including Ms. McVey and Ms. Campbell, threatening to irreparably harm the quality of the local news content that News 12 creates, the livelihoods of targeted News 12's employees, and the legacy that the Dolan Family protected through explicit Merger Agreement provisions.

Altice is alleged to have remarked that its singular rationale for wanting to terminate the two women anchors – both highly respected 30-year veterans of News 12 — was to have a "fresh look."

Lawsuit Overview

Plaintiffs' lawsuit requests, in sum, that the Court enter judgment in favor of plaintiffs, enjoining Altice USA from:

Terminating employment of any current employee of News 12, other than in the ordinary course of business to replace such individual for obvious cause with another person with equivalent qualifications;

Taking any action that would cause News 12 to cease to operate in substantial compliance with the News 12 Business Plan; and

Taking any action that would, in any way, violate or breach the Merger Agreement.

The lawsuit further requests ordering Altice USA to operate News 12 in substantial compliance with the News 12 Business Plan through at least for a cumulative five-year period.  

The plea for injunctive relief targets Altice USA because Altice ignored the commitments it made to attain its $17.7 billion merger with Cablevision.

The primary purposes of the lawsuit are to protect News 12 employees, consistent with the promises made by Altice in the Merger Agreement, and to continue News 12's rich legacy as one of the topmost local television stations in the U.S.

About News 12

News 12 is a group of cohesive, regional cable news television channels serving nearly 3 million households in New York State, Connecticut, and New Jersey including two boroughs of New York City and most of Long Island.

News 12 provides news coverage 24 hours a day, and focuses on providing award-winning, hyper-local, in-depth news coverage that is rare in the United States, particularly with respect to the region it serves.

The Dolan Family deliberately and methodically built News 12 as the foremost hyper-local news source for the edification of Long Island, Bronx, Brooklyn, and other communities.

Due to the pre-merger journalistic freedom provided by Cablevision's ongoing financial support, the employees of News 12 were able to pursue important stories addressing significant local issues relevant to millions of individuals residing in the coverage area.

No news station would have otherwise had the resources to uncover and report these vital stories.

News 12 was and is of singular importance to the Dolan Family, News 12's employees, and the viewers within News 12's coverage community.

About Altice

Altice USA (NYSE: ATUS) is a Delaware corporation. Altice Europe is a Dutch company. Altice Europe is successor in interest to Altice N.V., and thereby bound to the terms of the 2016 Merger Agreement.

Altice USA is one of the largest broadband communications and video service providers in the United States, delivering broadband, pay television, telephony services, proprietary content and advertising services to approximately 4.9 million residential and business customers across 21 states through its Optimum and Suddenlink brands.

Cision View original content:http://www.prnewswire.com/news-releases/charles-f-dolan-requests-new-york-state-public-service-commission-review-altices-management-of-news-12-300815401.html

SOURCE The Dolan Family


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